Brexit Report

23 June 2018

2 Years Since The

Brexit Referendum

1 Year Since The

Establishment of The
DCU Brexit Institute
This report was edited by the Director
and the Team of the DCU Brexit Institute
— Federico Fabbrini, Ian Cooper, Andreja
Pegan and Sharon Sorohan — and
graphically designed by Garvan Doherty.

© DCU Brexit Institute 2018

Contents

Foreword Brian MacCraith 2

Introduction Federico Fabbrini 3

The Negotiations

The Rights of Citizens Brenda Daly 8

The Border John Doyle & Eileen Connolly 10
The Financial Settlement Anthony Foley 12
Withdrawal, Transition and Future Relationship Ian Cooper 14
Brexit and the Future of Europe Federico Fabbrini 16

The Sectoral Impact

Energy and the Environment Diarmuid Torney 20

Financial Services Mark Cummins 22
Medicine and Public Health Anthony Staines and Ross Nugent 24
Customs and Trade Edgar L. W. Morgenroth 26
Agriculture and Regional Development Andreja Pegan 28

The Challenges

Political Gary Murphy 32

Legal Stephen Coutts 34
Business Pamela Sharky Scott and Dónal O’Brien 36
Media Roderick Flynn 38
Education and Research Daire Keogh 40

Conclusion Federico Fabbrini 43

Facts and Figures 45
01
 Foreword
June 23, 2018 will mark 2 years since the Brexit referendum and 1 year since the formal
establishment of the DCU Brexit Institute. The decision of the United Kingdom (UK) to leave
the European Union (EU) represents, in the European context, one of the most significant
democratic and political decisions of our time, with potentially major economic and societal
implications, especially for the UK and Ireland.

At the same time, the process of withdrawal is rife with uncertainties, and it is a source of
major challenges for the UK, for the EU generally, and for Ireland specifically. Because of
these challenges and the scale of the potential implications, and consistent with our ethos of
applying our expertise to major societal issues, DCU decided to create the Brexit Institute.
It is Ireland’s only such institute and was the first in Europe specifically established to explore
the challenges posed by Brexit.

The DCU Brexit Institute, as it is formally known, brings together academic experts from
across many disciplines in the University and serves as a platform to connect their expertise
to government, business and society at large.Through a combination of important research
outputs, consultative events, and policy analysis, the DCU Brexit Institute has quickly
established itself as a leading national and international forum to provide insights and
informed commentary on Brexit.

Over the past year, the DCU Brexit Institute has organized a series of high-profile events,
closely tracking the developments of the Brexit negotiations, and exploring their impact for
specific economic sectors. In addition, members of the Institute have produced a stream of
published outputs, including books, institutional reports, working papers and weekly blogs,
and, through these, have greatly enriched public debate on Brexit.

Marking the first anniversary of the Institute’s establishment, this booklet aims to summarise
its key contributions to date and the current state of the Brexit process from a range of
perspectives. Of course, it also serves to showcase the wealth of expertise on Brexit-related
matters that has been brought together under the umbrella of the Institute.

All of the contributions in this booklet were written by DCU staff members and they address
topical issues in the Brexit process. The booklet will provide readers with a useful overview of
the key Brexit themes and of progress (or, indeed, lack of same!) to date. I hope that they will
find this work of interest and of value and that it may stimulate their engagement with the
DCU Brexit Institute and its activities in the period
ahead.

As President of DCU, I am very pleased with the

valuable work that has been carried out to date by
the Institute and I pay tribute to its Director, Prof.
Federico Fabbrini, and its members from across
the University. I also to express our gratitude to
our sponsors, Arthur Cox, who have supported the
Institute in many ways over the past year.

At the time of writing, the Brexit process is

characterized by uncertainty, complexity, and
political tension. Perhaps all that is clear at this time
is that difficult and complex negotiations lie ahead,
that the process will last for many years beyond
2018, and that the lives of many individuals will be
affected by its outcomes. In such circumstances, the
role of the DCU Brexit Institute will continue to be
important and this booklet will mark just the first
milestone on a significant journey.

Professor Brian MacCraith,

President, Dublin City University
02
Introduction

The DCU Brexit Institute inaugurated its activities on 14 September 2017 with a Conference on
“Which Brexit After the UK Elections?” The event was opened by a keynote speech of Helen McEntee
(Minister of State for European Affairs of Ireland) – a DCU alumna. The Conference also featured
two panels of experts from academia and government – Iann Begg (London School of Economics),
Thomas Beukers (Ministry of Foreign Affairs of the Netherlands), Federico Fabbrini (DCU), Ana
Gouveia (Ministry of Finance of Portugal), Emily Jones (Oxford University), Kristien Michoel (Legal
Service of the Council of the EU), and Rory Montgomery (Department of Foreign Affairs and Trade of
Ireland) – moderated by Judy Dempsey (Carnegie Europe) and Ruadhan MacCormaic (Irish Times).
Moreover, the event featured a keynote speech by Baroness Hilary Armstrong of Hill Top (Member
of the UK House of Lords EU Committee) and was concluded by the keynote address of Georgios
Katrougalos (Minister of European Affairs of Greece).

Two years ago today – on 23 June 2016 – the border between Ireland and Northern Ireland; 3)
people of the United Kingdom (UK) voted to leave the financial settlement owed by the UK to the EU.
the European Union (EU). While the result was close
– 51.9% of citizens supported leaving the EU, even While negotiations proceeded slowly through the
as a majority of people in Scotland and Northern autumn of 2017, thanks to the efforts of EU Chief
Ireland voted to remain within it – the Brexit Negotiator Michel Barnier and UK Secretary of
referendum triggered an unprecedented event: State for Exiting the EU David Davis, the two
the withdrawal of a member state from the EU. parties reached agreement on 8 December 2017
on a joint report. This opened the door to the
Dublin City University (DCU) immediately second phase of the negotiations, focusing on
moved to examine the deep causes of the Brexit
referendum, and the direct consequences of this
decision – in a conference which resulted in the
publication of a volume on “The Law & Politics of
Brexit”. Yet, the process of UK withdrawal from the
EU continued with shifts and turns, surrounded by
an ongoing feature: uncertainty.

After the UK triggered Article 50 TEU on 29 March

2017, notifying the European Council of its decision
to leave the EU, British Prime Minister Theresa
May played a gamble by calling a general election.
Contrary to expectations, however, on 8 June
2017 the Conservative Party lost its parliamentary
majority, and was forced to begin negotiations with
the EU from a weaker position.

As demanded by the European Council, the Brexit

negotiations were divided into two phases; the
first phase focused on solving three key issues in
the UK withdrawal from the EU, namely: 1) the
protection of the rights of EU citizens in the UK,
and UK citizens in the EU; 2) the resolution of the
03
 setting the framework for future EU-UK relations.
However, in spring 2018, discussions stalled on a
number of files. While on 28 February 2018 the
EU Commission published a draft withdrawal
treaty codifying the diplomatic deal reached in
December, and the UK Government accepted
75% of it on 14 March 2018, strong disagreement
remain among the parties on issues connected to
the Irish border and governance of the agreement.
In fact, intense political discussions are continuing
within the British institutions on the shape that
Brexit should take, and – as a crucial European
Council meeting is approaching on 28-29 June
2018 – social and economic pressures are mounting
within the UK to find a framework of relations
with the EU which would minimize the costs for
businesses and citizens alike.
Two years after the UK decision to leave the
EU, it is clear that the implications of Brexit are
overwhelming as they touch all economic sectors
– from trade in goods to financial services, from
energy and climate change, to pharmaceutical,
agriculture and aviation policy – not to mention of
course the effects on security and justice, foreign
affairs and development cooperation.
The exploration of the unprecedented challenges
posed by Brexit required the creation of a
dedicated observatory. And it is precisely for this
reason that DCU decided to establish the Brexit
Institute – which is Ireland’s only and Europe’s first
center specifically dedicated to examining the
implications of the UK withdrawal from the EU
from both a research and a policy perspective.
For exactly a year now, the DCU Brexit Institute has
fulfilled its mission by offering a high-level platform
to document and debate the developments in
the Brexit negotiations, and the effects that
Brexit produced across economic sectors.
Through policy seminars, business dialogues and
scholarly publications the DCU Brexit Institute
DCU Brexit Institute
has endeavored to provide clarity in a world of
uncertainty.
The booklet that you have in your hands is the
latest example of the wealth of expertise that
the DCU Brexit Institute brings to the Brexit
discussion. The contributions – written by
academics from Schools and Faculties across DCU
– offer an overview of the main items in the Brexit
04
negotiations, of the key sectors impacted by Brexit
and the crucial challenges that lay ahead.
Part I of the booklet focuses on the Brexit
negotiations and includes contributions by Brenda
Daly on citizens right, Eileen Connelly and John
Doyle on the Irish border question, Anthony Foley
on the financial settlement, and Ian Cooper on the
transition deal – as well as a reflection by Federico
Fabbrini on the interconnections between Brexit
and the debate on the future of Europe.
Part II of the booklet considers instead the effect of
Brexit on a number of economic areas, and includes
the chapters by Diarmuid Torney on energy and
climate policy, Mark Cummins on financial services,
Anthony Staines with Ross Nugent on public health
and the pharmaceutical sector, Edgar Morgenroth
on trade, and Andreja Pegan on agriculture,
cohesion and regional policy.
Part III of the booklet, finally, discusses some
critical issues to be looked at as Brexit continues,
and includes contributions by Stephen Coutts on
the jurisdiction of the ECJ, Gary Murphy on Irish
politics, Pamela Sharkey Scott and Dónal O’Brien
on the challenges for business, Roddy Flynn on the
role of the media, and Daire Keogh on the impact
that Brexit has on universities and the education
sector.
While many of the contributions track events that
the DCU Brexit Institute organized throughout
the year, all chapters were written as brand-new,
self-standing contributions, with the aim to offer
to the reader a quick snapshot of where we are in
the process of UK withdrawal from the EU – and
some critical ideas of what we should expect as the
drama unfolds.
Brexit is a momentous event in the history of the
EU – but the process can only be fully appreciated
through an interdisciplinary lens, which combines
legal, political, economic and sociological analysis.
By providing thought leadership on this topic, the
DCU Brexit Institute is a resource for government,
business and society at large – and this booklet is
the latest evidence of that.
Federico Fabbrini,
Director, DCU Brexit Institute
05

05
06 DCU Brexit Institute
 The Negotiations
07 The Negotiations
 The Rights of Citizens

On 5 October 2017 the DCU Brexit Institute hosted an event on “Brexit, Citizens’ Rights and their
Protection”. The event was opened by a keynote speech by Bertie Ahern (former Taoiseach) and
closed by a debate between David Campbell Bannerman (Conservative MEPs Joint-Spokesman for
International Trade) and Bernard Durkan (TD, Fine Gael). The event also featured a panel of experts
- Pieter Cleppe (Head of Brussels Office, Open Europe), Ciaran Burke (Professor of International
Law, University of Jena, and Law Reform Commission), Brenda Daly (Senior Lecturer, Dublin City
University) and Dimitry Kochenov (Professor of European Law, University of Groningen).

Citizens’ rights have been a key priority of the
Brexit negotiations from the outset. Despite initial
concerns regarding the lack of progress on the issue
of citizens’ rights, by the conclusion of Phase 1 of
the negotiations in December 2017, both the EU
and UK reached agreement in principle to ‘provide
reciprocal protection for Union and UK citizens, to
enable the effective exercise of rights derived from
Union law and based on past life choices, where
those citizens have exercised free movement rights
by the specified date.’ The December agreement
has been heralded by some as a significant step
towards guaranteeing protection for EU and UK
citizens’ rights. However, this sentiment is not
shared by others such as those groups representing
UK nationals abroad.
Withdrawal Agreement
Subsequent to the publication of the Joint Report,
the European Commission published a draft
withdrawal agreement documenting the agreed
legal text in March 2018. This draft legal text
has been approved by the EU-27 and the UK
government. Article 9 contains clarification
regarding the scope of the Withdrawal
Agreement, stating that it is applicable both to
UK citizens lawfully resident in the EU, and to
EU citizens lawfully resident in the UK ‘before
DCU Brexit Institute
to Brexit, than it is for any family members seeking
to move to the UK during the transition period or
post-Brexit. After Brexit, national immigration
laws will apply. Clarification has been provided
regarding the citizenship rights of those children
who are born, or legally adopted, after the
withdrawal date. Safeguards are also provided
within the Withdrawal Agreement regarding the
aggregation of social security payments, reciprocal
healthcare and pension entitlements post-Brexit.
An area of concern relates to the right of residence.
Article 10 of the Withdrawal Agreement provides
for continuity of residence, but this can be lost
should the EU or UK citizen be absent from the
host State for more than 5 years. There has also
been a great deal of consternation regarding the
requirement that citizens will have to apply for
settled status in the UK after Brexit.

the end of the transition period and [who]

continue to reside thereafter’. Frontier workers
are also included within the scope of Article 9. In
respect of family members of such citizens, the
position outlined in Article 9(e) of the Withdrawal
Agreement is that they must fall under one of the
qualifying conditions to acquire lawful residency.
The position is clearer for those family members
who are lawfully resident with an EU citizen prior
08
Transition period
There is an apparent lack of consensus regarding
the rights of EU citizens who arrive in the UK during
the transition period. The EU states that any EU
citizen arriving in the UK is entitled to expect the
same rights as EU citizens lawfully resident in
the UK prior to its withdrawal. However, the UK
government has repeatedly emphasised that those
EU citizens who arrive during the transition period
will not have the same rights as those currently
enjoyed by EU citizens living in the UK prior to
withdrawal day on 29th March 2019. The UK
government position is that EU citizens arriving
in the UK after 30th March 2019 and before 31st
December 2020 will acquire different rights to stay
and work from those EU citizens who are already in
the UK prior to the date of withdrawal.
Common Travel Area
Given the agreed commitment in the December
Joint Report to deal with the special circumstances
in Northern Ireland, it is not surprising that there
is a notable exception concerning the rights and
privileges of British and Irish citizens during the
transition period and after the UK withdrawal from
the EU occurs. In the UK position paper mentioned
above, the UK government confirms that any
proposals concerning the rights of those EU citizens
who move to the UK during the implementation
period, will not affect the rights of British and Irish
citizens. This position endorses the Common Travel
arrangements which predate the UK and Ireland’s
membership of the EU. The UK government
guarantees continued protection of British and
Irish citizens’ rights under the common travel area.
Effectively this means that British and Irish citizens
will not be subject to any requirements to apply for
settled status and will continue to enjoy the same
right to work, access education, and access to
social welfare entitlements and benefits. However
some commentators have questioned whether the
common travel area will be enough to safeguard
such rights post-Brexit as the common travel area
is a political, and not a legal, agreement.
Concluding thoughts
The current state of play creates different tiers of
rights for EU citizens in the UK. Those already
in situ are seemingly guaranteed continuation of
the status quo. Those EU citizens exercising their
right to free movement and who lawfully move to
the UK during the transition period will no longer
enjoy the same rights as those citizens already
resident in the UK. EU citizens arriving in the UK
after the transition period ends will be treated as
third country nationals. Concerns have also been
raised about the corollary rights of UK citizens
to freely move within the EU once the transition
period expires. Such concerns do not appear to
have been adequately allayed at this stage.
Brenda Daly,
Associate Professor of Law, DCU School of Law
and Government
The Negotiations
09
 The Border

On 26 October 2017, the DCU Brexit Institute hosted an event on “Brexit, the Border and the
Internal Market” with the support of the European Commission Representation in Ireland. The event
featured keynote speeches of Pascal Lamy (former Director general of the WTO, former European
Commissioner for Trade) and a debate between Alyn Smith (Member of the European Parliament)
and Neale Richmond (Member of the Irish Senate). The event also included a panel of experts from
academia, business and government - Carlos Closa (Consejo Superior de Investigaciones Científicas),
John Doyle (Dublin City University), Anne-Marie Martin (Council of British Chambers of Commerce in
Europe) and Dagmar Schiek (Queen’s University Belfast).

Now that there has been agreement on the
financial settlement and the rights of EU citizens
post-Brexit, the question of the Irish border has
become central to the negotiation of the EU-UK
‘withdrawal agreement’. Since the publication
of the draft withdrawal agreement in March
2018, which contains a solution to the Irish
border question that would only be triggered
if no final alternative solution was agreed (the
backstop), the British Cabinet has been in disarray.
Disagreements between Cabinet members,
and between individual ministers and the Prime
Minister, on the future relationship of the UK
to the single market have been both public and
acrimonious. Negotiations between the UK and
the EU have also been fractious and unproductive.
This issue of the border is a significant barrier to a
negotiated exit for the UK and if not resolved will
have serious consequences for Ireland.
In the absence of a negotiated withdrawal, the
inevitable hard border on the island of Ireland
will not only be a serious economic problem for a
10
small island with an integrated economy, it will also
jeopardise the peace agreement that currently
supports the political structures of Northern
Ireland and cross border policy collaboration. The
1998 Good Friday Agreement, that effectively
ended 30 years of conflict, is facilitated by an open
border, and is also supported by the institutional
structures of the EU, that has made the existing
level of cross border collaboration possible. Brexit,
therefore, is a serious challenge to the peace
process, as a closed border would not only have a
significant economic cost, but it would also be a
powerful symbol that the peace process had failed.
In these circumstances physical border posts would
inevitably be attacked, leading to an escalation
of security measures, and a spiral of violence. The
UK government, although stating a preference for
the absence of a hard border, has also ruled out
using WTO frontier exemptions to place a de-facto
border in the Irish Sea, and has not put forward
any alternative proposal which is acceptable to
the EU. The Irish government is supported by
the EU, but the possibility remains that wider
economic considerations will weaken this support,
with the potential to undermine EU cohesion, if
there is a perception that large EU states did not
support a small state, on an issue of vital national
importance.
Since the publication of the Joint Report on
the Brexit negotiations in December 2017,
contradictory and unworkable solutions put
forward by the UK have made progress difficult.
The Joint Report commits the UK to ‘address the
unique circumstances of the island of Ireland’, and
includes the Draft Protocol on Ireland/Northern
Ireland which provides a ‘backstop’ agreement in
the event of no overall agreement being reached.
This proposes that in the ‘absence of agreed
solutions, the United Kingdom will maintain full
alignment’ with the single market with the key
aim of protecting the 1998 Agreement. The draft
withdrawal agreement (19 March 2018) includes
provision for a legally operative version of the
“backstop” solution as part of the legal text of
the Withdrawal Agreement. The UK government
refused to sign off on the EU text or to provide
an alternative backstop text and in response has
floated a number of ideas that have not been
considered feasible by the EU or in some cases by
members of the UK government.
The UK government has suggested that
technology be used to monitor cross border trade
and avoid the need for border controls in Ireland.
However, as a UK parliamentary committee has
pointed out, this type of technology does not
currently exist. The idea of a complex customs
partnership was also suggested that would allow
the UK to retain open borders for trade with the
EU but without free movement of people, and
which would also allow the UK to conduct its own
trade negotiations with third countries. Following
the rejection of this proposal by EU negotiators,
the Prime Minister suggested that the ‘back stop’
solution would be applied to the whole of the UK
and not just to Northern Ireland. This would mean
that the UK would maintain regulatory alignment
with the EU after 2020. This suggestion was
strongly rejected by members of the UK Cabinet.
It is also not acceptable to the EU, as it would
mean granting single market access to whole of
the UK, without the UK accepting the integral four
freedoms or European Court of Justice oversight,
a very different proposition from treating the tiny
Northern Ireland economy as a special case. Given
the continued gulf between the UK’s suggested
solution and what is acceptable to the EU it is
unlikely that the June European Council meeting
will be able to report any significant progress,
prior to the absolute deadline to agree the text
of a withdrawal agreement at the October 2018
European Council. In these circumstances Irish
officials are concerned that the UK will succeed in
postponing a decision on the border question up to
the October deadline. In these circumstances the
UK hopes that the European Council would agree
a vaguely worded commitment on the Irish border,
effectively pushing a decision back to the end of
2020, as the issue does not arise in de-facto terms
during the transition period.
The UK believes that having all major issues on the
table simultaneously as the post transition treaty
is being finalised in 2020 will allow them more
leverage to sideline the issue of the Irish border in
the formal agreement. This is a high risk strategy,
as a refusal by the EU to accept the postponement
of any real decision, could mean the collapse of
the idea of a transition period, meaning the UK
would crash out of the EU on 29 March 2019.
Maintaining the integrity of the Single Market
means that the EU cannot agree to allow the UK
preferential access without any of the shared costs.
If the UK maintains its refusal to allow special case
treatment for Northern Ireland this will result in a
stalemate. In these circumstances a hard Brexit
seems the most likely outcome with all the negative
consequences that it will entail.
The Negotiations
Eileen Connolly,
Professor of International Politics, DCU School of
Law and Government
John Doyle,
Professor of Politics and Dean, Faculty of
Humanities and Social Sciences
11
 The Financial Settlement
On 23 November 2017 the DCU Brexit
Institute hosted an event on “Brexit, the
Financial Settlement and the Future of EU
Finances” in cooperation with the European
Parliament Information Office in Ireland. The
event featured an opening keynote speech by
Baroness Falkner of Margravine (Chairwoman
of the UK House of Lords EU Financial
Affairs Sub-Committee) and a closing
keynote speech by Mairead McGuinness
(Vice President of the European Parliament).
The event also featured a panel of experts,
leading academics, business leaders and
policy-makers, including Tony Foley (Dublin
City University), Michael Keating (Center
on Constitutional Change), Colm Kelpie
(Irish Independent), Thilo Maurer (European
Commission) and Kim Lane Scheppele
(Princeton University).
The EU and UK have agreed both the concept
of a Brexit divorce financial settlement and the
methodology for finalizing the amount of the
settlement. There is no agreed identified final
figure. This will flow from the methodology
and will be paid over time. Of course, the
financial agreement, like all other aspects of the
negotiations, depends on overall agreement on
all elements of Brexit. As noted in the December
joint report, “nothing is agreed until everything is
agreed.”
The details of the financial settlement
methodology are identified in the December Joint
Report and are developed further in the Draft
Agreement of March 2018. Neither document
identifies or estimates the size of the amount to
DCU Brexit Institute
be paid by the UK. The EU has not produced an
official estimate but the UK Treasury (January
2018) has estimated the figure to be about €40 to
€45 billion or £35-39 billion sterling. This is a net
figure which takes account of payments minus
receipts. The Treasury estimate refers to the net
impact on the UK economy as opposed to the
Government finances. The impact on the UK public
12
finances will be higher than the €40-45 billion
because the Treasury estimates include receipts
from the EU which will go to the private sector and
will not flow into the Government accounts. The UK
National Audit Office estimated this aspect to be
about €8 billion.
The financial settlement methodology consists
of four elements; a) a list of components to be
financed, b) calculation principles and payment
details, c) arrangements for continuing UK
participation in programmes of the current
Multiannual Financial Framework until their
termination and d) matters relating to various
EU institutions and activities such as EIB, ECB,
Facility for Refugees in Turkey and The European
Development Fund.
The UK will contribute to and participate in the
2019 and 2020 EU budgets as if it had stayed as
a member using the existing payment system and
mechanism. The UK will contribute to existing
EU budgetary commitments which continue
beyond December 2020. It is notable that these
two budgetary components constitute the great
bulk of the UK net financial payment. The UK
will contribute to EU liabilities and contingent
liabilities incurred up to December 2020. The UK
will be repaid appropriate shares of any paid-in
guarantees.
The UK Treasury estimates the following payments
relating to the different components. The net
contribution to the 2019 and 2020 budgets will be
£15-16 billion. Continuing budget commitments
for 2021-2026 will amount to £19-20 billion. The
share of EU assets and liabilities is between £2
and 4 billion and will continue until 2064. This gives
a total net settlement of £35-39 billion allowing
for rounding. Most of the settlement will be paid
before the end of the next EU budgetary period in
2027. By then £34-36 billion will have been paid.
Excluding the monies related to liabilities and
assets, the net £34-36 billion will be paid over eight
years or an average of £4.5 billion per year.
The Treasury figure for the settlement is an
estimate. The actual value of the settlement
depends on future events and is therefore
uncertain. The UK National Audit Office has
identified some of these uncertainties. The
economic performance of the UK in 2019 and
2020 will determine the UK’s budget contribution.
This may be different than currently anticipated.
Assumptions of inward receipts from the EU to the
private sector may prove optimistic. The settlement
is to be paid in euro (Article 127 of the March
Agreement) and the current assumptions about
the future exchange rate may be wrong resulting
in either a higher or lower Sterling payment. The
Joint Report includes the expectation that the UK
will honour its commitments to the 11th European
Development Fund. The Treasury estimates did not
include this item and it could add almost £3 billion
to their settlement estimate. The EDF also has
some assets, a share of which (about €500 million
or £450 million) will be repaid to the UK.
The financial settlement is very detailed. Overall,
in my opinion, it is a triumph for the EU. It is a
blow to a “hard Brexit” approach and a victory
for agreement and cooperation. It has locked
the UK into continuing with its 2019 and 2020 EU
budgetary commitments as if it continued to be a
member of the Union. It has obtained commitment
for ongoing budgetary commitments long after the
UK exit. It has established the principle of the UK
continuing to contribute to existing liabilities. It has
established the euro as the medium for payment.
It must be acknowledged that the UK prime
minister in her Florence Speech of September 2017
stated “The UK will honour commitments… so that
other member states shall not need to pay more
or receive less over the remainder of the current
budget plan…” The financial settlement certainly
delivers this and much more by pushing additional
budgetary commitments into the post-2020
budgetary period. It is likely that the eventual cost
of the divorce bill will exceed the current estimates.
Certainly, the cost to the UK exchequer will exceed
the current Treasury net Brexit bill estimate of
€40-€45 billion. It is difficult to identify any major
EU objectives which have not been achieved in
the financial settlement. Equally, it is difficult
to identify any major issues where the UK has
dominated.
As the provisions of the settlement are quantified,
apart from the 2019 and 2020 budgetary
contributions, there may be disagreements
between the EU and the UK. An independent
arbitration mechanism is conspicuous by its
absence in the financial settlement. Of course,
if there is no overall Brexit deal, the financial
settlement will fall by the wayside and alternative
legal mechanisms may be used by the EU to collect
what it perceives to be monies which are legally due
from the UK.
Anthony Foley,
Emeritus Associate Professor of Economics
DCU Business School
The Negotiations
 Withdrawal, Transition and Future Relationship

On 7 December 2017, the DCU Brexit Institute hosted an event on “Moving on? From Brexit to Future
EU – UK Relations”, in partnership with Ibec. The event featured keynote speeches by Pat Cox (Former
President of the European Parliament) and Alojz Peterle (former Prime Minister of Slovenia, Member
of the European Parliament). The event also featured a panel of experts - Kenneth Armstrong
(University of Cambridge), Karen Banks (European Commission legal service), Ian Cooper (Dublin City
University) and Kathryn O’Donovan (Ibec).

The UK is due to leave the EU on March 30, 2019.
To ensure an orderly Brexit, before that date the
two sides must reach an agreement with three
separate elements, identifiable by the initials,
“WTF”.
There must be (1) a Withdrawal settlement to
arrange the terms of the “divorce”, (2) a Transition
deal to cover the relationship immediately after
the withdrawal and (3) a Framework for Future
Relationship which will outline the final terms of
post-transition EU-UK relations. The first two will
comprise a formal document (the Withdrawal
Agreement) and the third will take the form of a
political declaration.
Tentative agreement has now been reached on
Withdrawal and Transition, making it possible
for discussions on the Framework for Future
Relationship to begin. But because nothing is
agreed until everything is agreed, there is still no
guarantee that a disorderly “cliff-edge” Brexit will
be averted.
Withdrawal 2017 the EU found there was not yet “sufficient
After the UK triggered Article 50 in March 2017,
the EU demanded a two-stage negotiation, in
which the terms of the withdrawal must be settled
before the talks could turn to future relations.
Three key withdrawal questions would need to
DCU Brexit Institute
the two negotiating stages were interlinked. In
May 2017 the UK’s chief negotiator, David Davis,
promised “the row of the summer” over the question
of sequencing. He insisted it would be “wholly
illogical,” in particular, to try to settle the Irish
border question without knowing what the new
EU-UK customs arrangements would be.
Then came the UK election in June, when the
Conservatives lost their majority and made the
fateful deal to carry on governing with the support
of the DUP. When Davis met again with Michel
Barnier, the EU’s chief negotiator, he was in a
weaker position, and acquiesced to the two-stage
negotiation. The “row of the summer” did not
disappear, however, but rather turned into the row
of the autumn, winter, and spring.
As negotiations continued into the autumn,
progress was made on the first two issues but not
the third. In her Florence speech in September
2017, Theresa May made significant concessions
on the divorce bill and on the legal recognition of
the rights of EU citizens in the UK. Yet in October
progress” to move to stage two, mainly due to a
lack of progress on the Irish border question.

be addressed in the first stage: the financial

settlement (the “divorce bill”), the rights of EU
citizens in the UK (and vice versa), and the land
border between Northern Ireland and the Irish
republic. Only when the EU deemed there to be
“sufficient progress” on these three questions could
the negotiations move on to the second stage.
Initially, the UK rejected this plan, insisting that
14
A breakthrough seemed to come in December,
when it was agreed that, in the absence of other
solutions, “full alignment” would be maintained
across the Irish border. The DUP had deep
misgivings about this “Brexit border backstop,”
fearing that it would entail a border in the Irish Sea;
the only alternative seemed to be that the whole
of the UK would remain in full alignment with the
EU. This ambiguous solution allowed for “sufficient
progress” to be declared, but it also ensured that
the Irish border would continue to be a contentious
subject of negotiations into the second stage.
Large sections of the Protocol on Ireland/ Northern
Ireland remained unresolved in the colour-coded
“Draft Withdrawal Agreement” that was struck in
March 2018.
Transition
In her Florence speech, Theresa May also accepted
the necessity of a transition period in which the UK
would maintain full market access and continue to
abide by EU rules even after it has formally left the
EU. She proposed a period of “about two years”
with a flexible end-date.
The Draft Withdrawal Agreement foresees a
shorter transition of twenty-one months and two
days, with no provision for an extension (although
this is subject to change). The EU insisted on
31 December 2020 as the end-date because it
coincides with the completion of its current 7-year
budget cycle.
The UK government calls the transition an
“implementation” period, but this is something of a
misnomer because there will not in the first instance
be anything to implement. (Of course
“transition” is also somewhat misleading
because it implies a known destination.)
In fact, only after the UK has left the EU would the
negotiations on a future treaty begin in earnest. If
the UK “red lines” are maintained, and it leaves the
Single Market and the Customs Union as promised,
this must be a free trade agreement like that
between the EU and Canada.
The Brexit Committee of the House of Commons
warned in a recent report that 21 months will not
be sufficient time either to conclude and ratify
all the agreements that will define the Future
EU-UK Relationship, or to implement whatever
new controls will be needed at the UK border. It
recommended that the UK government should, if
necessary, seek an extension either of the “Article
50 time” (which would require unanimous approval
of the European Council) or of the transition.
Framework for Future Relationship
The third element to be agreed is the Framework
for the Future EU-UK Relationship. This will not
take the form of a treaty but a political declaration
that will accompany the Withdrawal Agreement. It
may outline not only future economic relations but
also some kind of new political relationship – e.g. an
“association agreement,” as suggested by the EP.
The UK Government aims to agree the “substance”
of the future relationship by October 2018 in order
to allow for its approval in a “meaningful vote” in
the UK parliament prior to Brexit.
Ian Cooper,
Research Fellow, DCU Brexit Institute
The Negotiations
15
 Brexit, Ireland and the Future of Europe
On 25 January 2018 the DCU Brexit Institute
hosted an event on “Brexit, Ireland and the
Future of Europe”. The event constituted the
official launch of the Brexit Institute and was
opened by the keynote speech of Michael
D. Higgins (President of Ireland). In addition,
the event featured the keynote speeches of
Hilary Benn (Chairman of the UK House of
Commons Brexit Committee), Herman van
Rompuy (first President of the European
Council), and Helen McEntee (Minister
of State of EU Affairs of Ireland) and was
concluded by Simon Coveney (Tanaiste and
Minister of Foreign Affairs and Trade of
Ireland). The event also featured a panel of
experts from academia and civil society –
Dan Kelemen (Rutgers University US), Etain
Tannam (Trinity College Dublin) and Noelle
O’Connell (European Movement Ireland) –
moderated by Dearbhail McDonald (Irish
Independent).
Important developments have recently taken place
in the Brexit negotiations as well as in the debates
on the future of Europe. On 15 December 2017, the
European Council decided that sufficient progress
had occurred in the UK withdrawal negotiations,
authorizing the European Commission and the
British Government to move into phase two of the
Brexit talks, which will focus on the future relations
between the UK and the EU. At the same time, the
pro-European élan of French President Emmanuel
Macron and breakthroughs in the German coalition
negotiations have reignited cooperation between
Paris and Berlin on EU reforms, sealed on 22
January 2018 in a joint Franco-German declaration
on the future of European integration.
DCU Brexit Institute
Debates on Brexit and the future of Europe are
treated in Brussels as well as in most national
capitals as separate files. In fact, they are
intimately connected, since they represent but
two pieces of the broader European puzzle. While
the decision of the UK to withdraw from the EU
signals the desire of this member state to scale
down its level of integration, the French-led project
16
to relaunch integration among a core group of EU
member states demonstrates the willingness of
other countries to deepen their cooperation within
the EU. If adequately reconnected, therefore, the
Brexit negotiations and the debate on the future
of Europe provide an exceptional opportunity to
redesign the EU to make it simultaneously more
inclusive and more effective.
The technique to achieve this is through an
architecture of concentric circles.
Since the Treaty of Maastricht in 1992 the EU has
accommodated increased differentiation among
its member states: some countries have opt-outs
(e.g. from the euro, or Schengen) while others
could develop enhanced cooperation between
themselves on specific policy fields. The underlying
assumption of all these forms of differentiation was
however that all member states would move in the
same direction, albeit at different speeds. Brexit, of
course, has shattered that expectation, revealing
how the UK was not committed to moving in the
direction of an “ever closer Union”. All of a sudden,
rather than multi-speed, the EU has emerged to be
multi-directional.
Certainly, the UK traditionally had an idiosyncratic
position vis-à-vis the project of European
integration. But no one should be fooled: not all
other 27 EU member states are truly committed
to the European cause to the same degree. The
legacy of the euro-crisis left deep scars between
Northern vs. Southern member states, and
responses to the migration crisis have exposed the
irreconcilable views of Western vs. Eastern member
states on issues like solidarity and refugees’ rights.
In fact, the authoritarian drift at play in Hungary
and Poland – which led the European Commission
in December 2017 to activate for the first time ever
Article 7 TEU, which may result in a suspension of
Warsaw’s EU voting rights – unearths the cleavages
at bay in the EU.
In this context, rather than repeating the trite
story that all member states will move together in
the same direction at their own speed, it may be
time to pause and rethink the forms of integration
available to European countries. This is what
President Macron had hinted at. And this is where
the Brexit negotiations become relevant. Instead
of just settling the unique British position vis-à-vis
the EU, the talks with the UK should become part
of a broader discussion of the levels of integration
available in Europe, and serve as a lab to devise a
form of associated membership which in the near
future may become suitable for other states. If
political integration appears necessary particularly
for the Eurozone, simple economic cooperation
should remain possible for countries outside it.
In a nutshell, the future of Europe should be
redesigned on the basis of an architecture of
concentric circles. In this model, the UK could
remain associated to the EU in an outer (looser)
circle of regional integration, in the company of
other third countries and current EU member
states, while another group of countries club in a
(tighter) circle of federal-like cooperation. States
at the periphery would only abide by those rules
necessary to ensure the functioning of the free
market, and regain sovereignty on other policies.
States at the core, instead, would willingly accept
to integrate further, endowing federal institutions
with greater sovereignty and democratic
legitimacy.
A political union surrounded by a regional
free market would be appealing for Ireland. In
particular, maintaining the UK associated to the
EU core in a free trade area would satisfactorily
settle the problem of the border between Ireland
and Northern Ireland, which was left unresolved
in the deal concluding phase one of the Brexit
negotiations, and still remains a contentious issue
as talks advance in the second phase. Nevertheless,
a Europe of concentric circles would also raise
challenges for Ireland, especially if participation in
the core becomes – as it should – a package deal
with no opt-outs, e.g. in the field of defense and
taxation.
Yet, speaking in Strasbourg on 17 January 2018
as the national leader to address the European
Parliament in the framework of the new series of
debates organized by that assembly on the future
of Europe, Taoiseach Leo Varadkar emphasized
the commitment of Ireland towards further
European integration. As he put it, Ireland, having
benefitted so much from EU membership, has
a special responsibility to lead on the future of
Europe debate. By proactively contributing to the
conversation on EU reforms, Ireland can thus shape
the future of Europe in a way that is more congenial
to the interests of small member states.
Federico Fabbrini,
Professor of EU Law, DCU School of Law and
Government
The Negotiations
17
18
The Sectoral Impact
19
 Energy and the Environment

On 15 February 2018 the DCU Brexit Institute organised an event on “Brexit, Climate and Energy
Policy”, in partnership with the Irish Environmental Protection Agency and the Political Studies
Association of Ireland. The event featured an opening keynote speech by Enrico Letta (former
Italian Prime Minister and dean of the Paris School of International Affairs (Sciences Po)) and a
high-level panel featuring Laura Burke (Director General of the Environmental Protection Agency)
and Julia King, Baroness Brown of Cambridge (Deputy Chair of the UK Committee on Climate
Change). The event also featured a panel of leading academics, business leaders and policy-
makers, including Charlotte Burns (University of Sheffield), Joseph Curtin (University College Cork
& IIEA), Tanya Harrington (Powerscourt Group) and Diarmuid Torney (Dublin City University).

In some ways, the EU’s development of a
substantial body of environmental law is surprising.
Indeed, the Treaty of Rome contained no explicit
environmental provisions. Since then, however,
EU environmental policy has developed from
an incidental policy in the 1970s, which focused
primarily on removing barriers to trade between
member states, to a “system of environmental
governance”. This governance system covers a
wide range of environmental challenges, including
air and water quality, birds and habitats, as well
as global environmental challenges such as ozone
depletion and climate change.
The extent to which the EU and UK environmental
governance regimes remain aligned post-Brexit
will depend on the nature of the Brexit settlement.
The EU’s existing relations with a range of third
countries provide a variety of possible future
models. Although Secretary of State of the
Environment Michael Gove has committed to
delivering a “Green Brexit”, the UK Government’s
search for new markets may drive a regulatory
race to the bottom, including on environmental
standards.
Over the past two decades, climate change has
DCU Brexit Institute
threshold set by climate scientists. In order to close
this gap, much deeper cuts in greenhouse gas
emissions are needed between now and 2030 as
well as beyond.
Climate change is a quintessentially global
problem. The landmark Paris Agreement on
climate change, forged by nearly 200 governments
at the COP21 climate summit in 2015, provides a
framework for global cooperation. Donald Trump’s
announcement in June 2017 that he intends to pull
the US out of Paris certainly dealt a blow to global
efforts, but the response by the rest of the world —
including by the EU, China and Canada as well as
by many states and cities within the US — has been
encouraging.
The EU has long been a leading player in the global
response to climate change. The EU persevered
with the 1997 Kyoto Protocol following the
withdrawal of the US, and played a central role
in shaping the Paris climate agreement. At home,
the EU has developed a progressively wider and
deeper set of policies to deliver on its international
commitments. Brexit poses challenges for the
European response to climate change in at least
four areas.

become perhaps the highest profile area of EU

environmental policymaking. The scale of the
decarbonisation challenge facing the world is
nothing short of daunting. According to the UN
Environment Emissions Gap Report 2017, climate
change policy pledges made by governments
around the world cumulatively amount to only
approximately one-third of what is required to limit
global warming to 2 degrees Celsius, a key danger
20
First, the UK’s withdrawal alters the balance
between progressive and laggard EU member
states when it comes to climate policy. The
UK has been among the vanguard pushing a
decarbonisation agenda within the EU over
the past couple of decades. Its departure will
complicate the EU’s efforts to decarbonise the
European economy.
Second, one of the Union’s flagship policy
instruments, the EU Emissions Trading Scheme (EU
ETS), may be undermined. The scheme requires
power generation companies and heavy industry
to possess permits to emit carbon dioxide. These
permits are tradeable on an EU-wide basis.
Companies for whom emissions reductions are
relatively expensive can purchase these permits
from companies for whom emissions reductions are
relatively cheaper, with the result that emissions
reductions occur in a cost-effective manner.
It is not yet clear what will happen to the EU ETS
post-Brexit. One option is that the UK could remain
in the scheme, similar to Iceland, Liechtenstein
and Norway who participate despite not being
EU member states. Another option is that the UK
could establish its own domestic emissions trading
scheme that could then be linked to the EU ETS.
The EU ETS has faced significant challenges, but
some observers are optimistic that these can be
overcome through reforms due to come on stream
in 2021. Brexit significantly complicates that
picture.
Third, Brexit will impact on the EU’s commitment to
decarbonise those economic sectors not covered by
the EU ETS—principally transport, buildings, and
agriculture. Member states have agreed to reduce
emissions from the non-ETS sector by 30% relative
to 2005 levels by 2030. Under a deal reached in
December 2017, each member state has been
allocated an individual share of this overall target.
The UK’s target of 37% is higher than the EU
average, meaning that Brexit will leave a hole in
the collective effort of the 27 remaining member
states.
Fourth, Brexit potentially undermines the EU’s
international climate diplomacy. The UK has been
at the forefront of European efforts to shape
global climate cooperation over recent decades.
The UK Foreign Office invested heavily in building
up an extensive network of climate diplomats
around the world. In a post-Brexit landscape, the
EU will lose one of its most active international
climate champions. On top of this, the UK’s
continued commitment to international climate
diplomacy is in question. In fact, a UK foreign policy
position paper published in September 2017 failed
to mention the Paris climate agreement among a
list of international treaties the UK is “committed”
to.
Perhaps the biggest risk to EU climate ambition is
that it slips down the policy agenda in the coming
years as the EU and UK struggle to manage the
Brexit process, particularly if we face a disorderly
Brexit. Policies to combat climate change have in
the past been subject to the vagaries of economic
and political cycles, such as during the depths of
the financial crisis.
Time is not on our side in the fight to combat
climate change. Although governments and
societies around the world are increasingly waking
up to the challenges posed by climate change,
many have not yet understood the scale of the
changes required. Brexit risks undermining the
progress the EU has made to date.
Diarmaid Torney,
Assistant Professor of Environmental Policy,
DCU School of Law and Government
21
 Financial Services
On 12 April 2018 the DCU Brexit Institute
hosted an event on “Brexit and Financial
Services” in partnership with Arthur Cox. The
event featured keynote speeches of Joaquin
Almunia (former European Commissioner for
Economic & Financial Affairs) and Ed Sibley
(Deputy Governor, Prudential Regulation,
Central Bank of Ireland). The event also
featured a panel of experts - Robert Cain
(Arthur Cox), Mark Cummins (Dublin City
University), Niamh Moloney (London School
of Economics), and Valerio Scollo (GSK
Luxembourg) – moderated by Federico
Fabbrini (DCU).
The territorial battle over the financial services
sector continues in the wake of the Brexit vote and
the continued uncertainty over the post-Brexit
scenario. Frankfurt, Paris, Dublin, Brussels, and
other cities are all vying for valuable financial
services business from London. Notwithstanding
that there have been some relocation
announcements, with Frankfurt appearing to
be the most successful of the competing cities,
we have not yet seen a mass exodus from the
City of London. The strategy to date has been
conservative on the part of financial institutions,
setting up regulated subsidiaries with limited
activities rather than the wholesale movement of
all activities.
The City of London is one of the major global
financial services centres for very good reason.
Over decades of investment, the City of London
has positioned itself to compete with, and arguably
overtake, New York. To contextualise its global
position, a London School of Economics discussion
DCU Brexit Institute
interest rate derivative turnover worth just under
€1 trillion euro; the City of London is a major
location for global insurance and reinsurance
functions, with some 600 insurers and reinsurers
in operation; while overall, the financial services
sector employs over one million workers. London
is not readily replaceable and, in my view, the
discourse around who will become the ‘new’ London
and who will benefit the most from a down-sized
City of London is misguided.
Financial institutions are gauging the political
negotiations and weighing up the pros and cons of
any relocation decision – and there are significant
pros and cons, both financial and strategic. In light
of the agreed 21-month transition period to the
31st December 2020, clear warnings are coming
from various quarters that financial institutions
need to continue with contingency planning efforts
and to prepare for the so-called ‘cliff edge’ no
deal Brexit scenario. But there simply has to be an
agreement. The financial ramifications of such a
worst-case ‘cliff edge’ scenario are incalculable, or
calculable only under a host of assumptions!
A core concern for financial institutions is that of
market access and EU passporting, which allows
the seamless delivery of financial services across
EU member states under the single market model.
The Brexit positions of the EU and the UK are quite
divergent here. The most the EU is indicating it
may offer in this regard is some form of improved
equivalence agreement with the UK. Such a
solution would mean the UK would get access to
the EU market but would effectively be bound to a
regulatory regime that aligns with that currently in
place in the EU but with the considerable risk that
the EU may rescind the equivalence agreement at
any stage and with short notice.
The UK position appears to be that of some form
of free trade deal with the EU in respect of financial

services, which would give the UK the autonomy

paper reports that one fifth of all global banking
it desires over the design of its own regulatory
activity flows through the City of London, with
regime. Given the embeddedness of the City of
some 250 foreign banks in operation; 45% of all
London in the global financial system and, more
assets under management in Europe are managed
importantly, in the European financial system, both
out of the City of London; the City of London is the
sides are deeply exposed and have a huge amount
leading location for counterparty clearing in the
to lose. The tenuous nature of an equivalence
world, with daily foreign exchange transactions
agreement would simply create unacceptable
worth some €1 trillion euro and a level of daily
levels of uncertainty. The only option in my opinion
22
is for the EU to engage with the UK and work on
a financial services specific free trade deal that
would provide mutual benefit to both parties and
provide long-awaited certainty to the financial
services sector. And there is much to discuss and
negotiate.
The Association for Financial Markets in Europe
provides a succinct summary of the main issues
that underscore the complexity involved. The first
issue is the continuity of financial contracts. Post-
Brexit, it is not clear how financial institutions are
to manage existing financial contracts when UK
based financial institutions lose EU passporting
rights. This has implications for both UK and EU
based counterparties, where losses and damages
may be incurred due to the inability of one or more
counterparties to meet contractual agreements.
The options are either to have the contracts
‘grandfathered’, whereby contracts are agreed to
be serviced as per contract terms up until maturity
post-Brexit, or to novate contracts to new entities
that would be regulated accordingly; although
for contracts involving multiple and cross-border
counterparties this could be extremely difficult to
agree. The second issue is that there is currently a
choice of legal jurisdiction for financial contacts
and an agreement by all Member States to
recognise and enforce judgements made in the
legal jurisdiction of any other Member State.
In this context, how the legalities of financial
contracts are to be managed post-Brexit needs
to be clarified. The third issue is that of contract
clearing and whether UK clearing houses will be
approved from a regulatory perspective post-
Brexit. With the City of London being the major
global base for clearing activities then if UK
clearing houses are not recognised, this could mean
significant increases in capital requirements for the
counterparties involved given that moving contract
positions from UK clearing houses to EU clearing
houses would be impractical. The fourth issue
relates to bank recovery and resolution. Currently
the Bank Recovery and Resolution Directive ensures
recognition of resolution actions across the EU. It is
not understood what the situation would be post-
Brexit. A related issue is the eligibility of financial
instruments governed under English law for capital
requirement purposes in a post-Brexit environment.
If such financial instruments are not recognised
then this would require financial institutions to
replace this capital, creating considerable cost for
the financial institutions in question and reducing
the availability of capital for investment. The
final and fifth issue has a GDPR resonance and
relates to the cross border movement of personal
data. Clarity is needed around the management
of personal data post-Brexit, particularly as the
banking sector becomes ever more data driven,
with the trend towards open banking.
The City of London is too big to fail and too big to
conquer and divide amongst the EU. As I see it, the
EU needs to face reality and concede to the UK
on the need to negotiate a financial services free
trade agreement that benefits both sides. Hard
negotiations are needed around the complex issues
outlined above by the Association for Financial
Markets in Europe, which is not an exhaustive list
The Sectoral Impact
of considerations. The financial services sector is
unique in comparison to other industry sectors.
Hence, a unique set of solutions is required. Both
the UK and EU need to meet somewhere in the
middle ground, and soon!
Mark Cummins,
Professor of Finance, DCU Business School
23
 Medicine and Public Health

On 3 May 2018 the DCU Brexit Institute hosted an event on “Brexit, Medicine and Public Health“ in
partnership with IQVIA. The event was opened with a debate between Baroness Suttie (Member of
the UK House of Lords, European Union Committee) and Paulo Rangel (Member of the European
Parliament, Constitutional Affairs Committee). The event also featured a panel of experts from
industry, government bodies and academia - Justin Carty (IMSTA), Rosarii Mannion (HSE), Eamonn
McGowran (BESIN Healthcare), Rita Purcell (Health Product Regulatory Authority) and Anthony
Staines (Dublin City University).

Brexit, in whatever form it eventually takes, is likely
to affect every segment of our society, and of our
economy. There are some obvious areas, which
have received much public attention, including
agriculture, borders, trade and customs, and the
rights of EU citizens resident in the UK. It’s not so
obvious, to most of us, how Brexit will affect Irish
health care, but it needs to be considered. There is
recent work from Nick Fahy and colleagues, on how
British health care may be affected, and it is worth
reviewing this too.
A number of conclusions may be drawn. The first,
and perhaps the most fundamental, is that it is
very unlikely that Brexit will be stopped. There are
various mechanisms for doing so, either through
a parliamentary reversal, or by calling another
referendum. The first is not a politically credible
option, and polls suggest it is unlikely that another
referendum will produce a different answer. It is
more plausible, perhaps, that the Conservative
party could realise the likely damage from Brexit
and move (or be pushed) to remain in a close
relationship with the EU. However, for any company
or state body at risk from Brexit to assume that it
will not happen would be a dereliction of duty. It
will be necessary to plan on the basis that, from 30
March 2019, the whole of the UK will exit the EU,
with or without an agreement.
This leads to the second conclusion. Brexit affects
every level of the health ecosystem, from the
producers, importers and exporters of drugs
and devices, to staffing, health service finance,
and patient care. For the producers the risks are
quantifiable. Essentially, the whole regulatory
system has to be re-authorised, to ensure that all
currently authorised products, either originating in
or going into the UK, remain authorised. To market
such items it is necessary to have a marketing
authorisation, but this can only be held by bodies
established within the EEA. Fixing the many
problems that will arise will involve identifying the
products, and developing UK-specific and Ireland-
specific regulatory forms. At present, these are
often identical, but that will change. There is a real
risk that some products will no longer be available
in Ireland. Getting and securing market access
for Irish products in the UK will also be expensive,
time-consuming, and increasingly urgent. To make
matters more challenging, products from the UK
will require specific import authorisation, and
many will require each batch to be tested within
the EU before release. It is not clear that there are
enough people with the necessary skills to deliver
this before March 2019.

For healthcare providers, matters are much less

certain. It’s not known how Brexit will affect the
supply of skilled health care workers, and the
24
mutual recognition of professional qualifications.
What is known is that, both the British NHS and the
Irish HSE are short staffed. Both the UK and Ireland
need to bring in significant numbers of staff from
abroad. HSE recruits between 4,000 and 7,000
staff each year, for example. After Brexit, the NHS
is likely to recruit more Irish staff, as the supply of
EU citizens wishing to work in the UK is shrinking,
and the current UK rules on immigration will restrict
many non-UK citizens from entry. It is hoped that
the professional qualifications of foreign staff in the
UK will continue to be recognised after Brexit, but
this remains an aspiration.
outlines for a post-Brexit relationship. Given this, it
is hard to see how any agreement can be reached
in a reasonable time. It is possible, and perhaps
likely, that a last-minute deal will be agreed,
perhaps containing a long transition period, and an
outline of a mutually desired end state. However,
to reiterate, no-one can depend on this happening.
Our key, and perhaps unsatisfactory, conclusion is
that we must all prepare for the worst of outcomes,
and hope that they will not occur. If we do not
prepare adequately, patients, and their families,
will pay the price.

Procurement will also be a major challenge both

for service providers and producers after Brexit.
It is simply not known how public and private
procurement will be impacted by Brexit rules.
The regulatory hurdles can be surmounted, and
regulators in Ireland, the UK, and the rest of the
EU are working very hard to do this. It may be
necessary to change existing contracts, and there
are substantial risks of losses, or disruption to
supplies, on both sides.

Third, there are wide and deep cross-border

healthcare links between the UK and Ireland.
For example, there are substantial and well-
established joint services for cancer, diabetes,
emergency care, and paediatric cardiac surgery.
In addition, almost 600 people a year are referred Anthony Staines,
to UK services, under the Treatment Abroad Professor of Health Systems, DCU School of
Scheme, typically for specialised care, or expertise Nursing and Human Sciences
which is not available in Ireland. There are also a
significant number of patients, over 700 in 2016, Ross Nugent,
who travel, mostly to Northern Ireland, to receive DCU Student
care without excessive delays, under the EU’s Cross-
border Health Care Directive. All of these services
are at risk. A recent All-Island Civic Dialogue on
‘Brexit – Implications for Cross-border Health Co-
operation’ articulated these issues, and others, but
could not indicate any solutions.
The Sectoral Impact

In fact, resolving these problems will not be easy.

One key to minimising the harm will be to keep
patients and patient care as the focus of health
system responses. Brexit poses many challenges,
and perhaps even a few opportunities for Ireland,
and Irish healthcare. The biggest challenge now
is uncertainty. It is painfully obvious that the UK
Government is unable to agree on their own desired
25
 Customs and Trade

On 14 June 2018, the DCU Brexit Institute organised an event on “Brexit, Customs and Trade” in
partnership with the British Irish Chamber of Commerce and DCU Invent. The event featured keynote
speeches by Michael Russell (Scottish Minister for UK Negotiations on Scotland’s Place in Europe)
and László Andor (former European Commissioner for Employment, Social Affairs and Inclusion).
The event also featured a panel of leading academics, business leaders and policy-makers - Katie
Daughen (British Irish Chamber of Commerce), Massimo Fabio (KPMG Italy), Ólafur Ísberg Hannesson
(EFTA Surveillance Authority) and Edgar Morgenroth (Dublin City University) – moderated by Audrey
Carville (RTE).

A key advantage of EU membership is the internal
market of the EU, which allows traders to trade
goods and services with minimal barriers. While
the impact of Brexit on the nature and extent of
trade barriers will depend on the final agreement
between the EU and the UK, Brexit will leave trade
between the UK and the EU less free.
Trade barriers can take many forms. For
merchandise trade tariffs or tariff quotas are
applied by the EU to a range of products from
third countries. While the average tariff charged
by the EU is relatively low at around less than 5%,
there is significant variation with the highest tariffs
being charged on agri-food products, followed
by basic manufactured goods including textiles.
For example, fresh mackerel is subject to a 20%
tariff. In many cases tariffs involve both a tariff
rate and a charge based on the weight or volume
of the products shipped. For example, fresh beef
is subject to a 12.8% tariff plus €303.4 per 100 kg
of beef. In some cases the tariff increases once a
quota of product has been reached.
would most likely be reciprocated by the UK. Static
simulations, where it is assumed that the effect
of tariffs is passed through to final prices and
where no allowance is made for trade diversion to
other countries, suggest that this would reduce
Irish goods exports to the UK by 30.5%, which
equates to 4.2% of total goods exports. Total UK
merchandise exports would be reduced by 9.8%
under these assumptions, while the effect for the
EU as a whole would be to reduce exports by 2.1%.
This shows that the impact of a hard Brexit would
be very significant for the UK and for Ireland the
effect would be double of that experienced on
average by EU countries.
In addition to tariff barriers, trade is also affected
by non-tariff barriers. These have featured less
in discussions about the impact of Brexit, but in
practice tend to be larger and are likely to be more
important as they might apply even in a situation
where trade between the EU and the UK is free
of tariffs, and could affect Irish trade with other
countries.

The variation of tariffs across different products
implies that the effect of tariff barriers will be
very different across sectors and the severity of
the impact will also depend on trade patterns. For
DCU Brexit Institute
Non-tariff barriers can take many different forms.
For example, a country may set technical standards
that differ from those that apply in the exporting
country, thereby requiring the exporter to make

example, the UK is the most important destination
for Irish beef exports while it is much less important
as destination of Irish pharmaceutical products.
A worst case scenario for Brexit, for example if
no final agreement between the EU and the UK
is reached, would entail the imposition of these
tariffs on imports from the UK into the EU. This
26
alterations to the product. A country may require
expensive certification, registration or treatment of
a product before it is allowed to enter the market.
There may be government procurement restrictions
or subsidies for local producers. Administrative or
inspection procedures may also result in additional
costs. These may also affect transiting trade, which
is important for Ireland as more than half of the
goods exported from Ireland to countries other
than the UK transit through the UK. Importantly,
given the many ways in which trade can be affected
by non-tariff barriers makes it more difficult to
remove these barriers via trade agreements.
While tariffs and non-tariff barriers are important
for goods trade, services trade tends to be more
restricted. Even a far-reaching trade agreement,
such as the recent Canada EU Trade Agreement
(CETA) removes almost all tariff barriers for goods
but retains many restrictions for services and in
particular financial services. For example under
CETA Canadian insurance companies are required
to set up local branches in member states in order
to supply the service services in the EU. Other types
of restrictions also apply. For example, airlines
operating within the EU must be majority owned by
EU shareholders.
The economic impact of Brexit will be significantly
determined by the nature and extent of trade
restrictions post-Brexit. This is not just dependent
on whether tariffs are imposed, but will depend
significantly on the degree to which non-tariff
barriers and trade restrictions will apply. The
potential impact of a hard Brexit could be
significant at least over the short-run, and will not
be restricted to reduced exports to the UK but also
due to the potential of raised costs for imports
from the UK. Irish trade with other countries may
also be affected by non-tariff barriers that may
apply to goods that are transhipped through the
UK, reflecting the fact that this is the shortest
route to the economic heart of Europe. Getting an
agreement with the UK on this aspect of trade is
therefore particularly important.
Edgar L. W. Morgenroth,
Professor of Economics, DCU Business School
The Sectoral Impact
27
 Agriculture and Regional Development
With the start of the debate on the multiannual
budget of the EU in May 2018 and Brexit getting
closer, the EU-27 and the UK find themselves in
similar situations: both need to look ahead to
define directions for agriculture and regional
development. Because of Brexit, they will carry
out these debates separately. The UK needs to
formulate new agricultural and regional policies,
whereas the EU-27 has started lengthy and
difficult negotiations over its 2021-27 multiannual
budget for the EU (aka Multiannual Financial
Framework - MFF).
What is at stake? In this commentary, I focus on
the budgetary and redistributive aspects that are
linked to these two policies.
Under the names of the Common Agricultural
Policy (CAP) and Cohesion Policy, agricultural
and regional development take up the largest
proportion of the EU budget. Brexit leaves a
vacuum in the EU budget. While in May 2018, the
European Commission proposed to increase the
EU budget, cuts in the CAP and Cohesion Policy
are envisaged to accommodate new needs (for
example border control).
Both EU policies will be implemented in the UK until
the expiry of the current EU budgetary period in
2020. Since it is unclear what the relations between
the UK and EU-27 will be in the long-term (e.g. UK’s
membership in the single market and/or a customs
union), it is difficult to predict the leverage the UK
will have in shaping these policies. The agricultural
policy has, in fact, implications for trade, while
British regional aid might be subject to EU state-
aid rules if the UK stays in the single market.
Agriculture
The CAP was the first common policy of the EU
(set up in the 1960s). While its treaty objectives
have remained the same, the policy has undergone
DCU Brexit Institute
considerable changes since the 1990s. While it
is no longer central in the debate on European
integration, agriculture remains a controversial
issue and the CAP is accused of being the EU’s most
economically inefficient policy.
Due to different national and sectoral interests,
negotiating the CAP is not an easy task for the EU.
In this respect, Brexit is an unambiguous benefit
28
for the UK and it provides the opportunity to make
British agriculture greener. However, time is tight.
The UK government guaranteed farmers that the
current CAP subsidies will be paid until 2020. A new
British agricultural policy needs to be implemented
after this date. In light of the workload to negotiate
the withdrawal agreement and the uncertainty
surrounding the future EU-UK relations, it seems
that the future British agriculture is likely to follow
the structure of the CAP with the amounts of
subsidies falling.
Subsidies will likely fall also in the EU-27. In May
2018, the European Commission proposed 5 % cuts
to the CAP budget, with circa 4 % cuts for farmer’s
income support (aka direct payments). Direct
payments are controversial. They are part of
what is known as Pillar I, which represents the
largest share of CAP expenditures. To address
the controversy on direct payment, some of
these payments are since 2013 dependent on
farmers implementing measures, which are
beneficial for the environment (aka “greening”) –
for example crop diversification. Finally, the CAP
has gradually expanded to include Pillar II or the
regional policy for rural development.
The scope of agricultural reforms is concerned
with the expenditure balance between and
within Pillars I and II. To what extent should
support of domestic agriculture be reduced? To
what extent does the CAP system help achieve
greater food self-sufficiency in the EU? Shall we
pay farmers for the public goods they provide?
These are some of the questions both the EU-27
and the UK will need to (separately) answer.
Regional development
In contrast to agriculture, the UK was instrumental
in setting up and supporting the EU’s regional
policy (aka Cohesion Policy). In the 1970s and
1980s, Cohesion Policy represented an important
mechanism for the UK to draw down EU funding
and to alleviate low budgetary returns from the
CAP. In time, the financial importance of Cohesion
Policy for the UK decreased and today’s funding
amounts to 0.1 % of UK GDP. However, the
benefits of Cohesion Policy have varied greatly
within the UK, where EU funds have been a
significant funding source for local actors. Cohesion
Policy has been important in particular for the
poorer parts of the country (for examples Wales
and Cornwall), some of which voted to leave the
EU.
Under the current 2014-20 Cohesion Policy
programme, the UK uses EU funding for improving
the labour market, combating social exclusion,
promoting research and development and
transitioning to a low-carbon economy. The British
government has made no commitment to continue
regional support, which puts these long-term
development goals at risk. The need for a strong
regional policy in the UK is further warranted due
to large regional differences in income, wealth
and productivity, which stand out compared to
those in the EU-27. Cohesion policy is based on
a transparent allocation mechanism (GDP per
capita). It remains to be seen how government
funding will be distributed between different
regions and nations within the UK in the future.
Another clear contribution of Cohesion policy to
the UK has been the strengthening of social justice
in British economic development.
Regarding the EU-27, the European Commission
proposed to cut funding for Cohesion Policy by 7
% (even though the EP estimates the cuts will be
higher). The new legislation underpinning spending
will deal with questions on the policy’s geographical
scope (e.g. shall it be limited to less developed
regions only?) and purpose (e.g. shall it be re-
aligned with the economic semester and become
an instrument for structural reforms?). The question
of simplification will also need to be addressed, as
well as the use of financial instruments.
In sum, the same old negotiation challenges are
in front of the EU-27, with the addition of the
question of whether and how to fill in the vacuum
left by Brexit. On the British side, on the other hand,
the opportunities from leaving the EU seem clearer
in agriculture than in regional development.
Andreja Pegan,
Research Fellow, DCU Brexit Institute
The Sectoral Impact
29
30
The Challenges
31
 The Political Challenge
In April 1970 T.V. Commins, commenting on Irish
ambitions to join the EEC, the Irish ambassador to
France wrote to the Department of Foreign Affairs
about Ireland’s relationship with Northern Ireland:
“On the Northern Ireland problem, it does not seem
unrealistic to envisage that membership of the
Community (jointly with Britain) will, in the nature
of things, ease the way towards eventual abolition
of the border, at least in the long term if not in the
immediate or medium term.
“
[National Archives of Ireland, Department of Foreign Affairs,
2001/43/1139, Commins to Morrissey, 16 April 1970.]
Some two decades’ years later Commins’s
prescience was realised when the creation of the
single market in 1992 and the continuation of the
peace process, which would come to fruition in the
1998 Good Friday Agreement, saw the end of any
visible border between the two parts of Ireland.
Now another two decades on from that historic
peace agreement the prospect of a hard Brexit
brings with it the danger of a return to a very real
and equally hard land border. Ever since the British
voted for Brexit, party politics in Ireland has been
convulsed by its implications for Ireland. And this is
for good reason, as the potential consequences of
Brexit for Ireland are stark. Ireland’s commitment
to the European project, the fact trade with Britain
is such an essential part of the Irish economy and,
probably most importantly, doubts about what
exactly will happen to the border between North
and South have remained constant questions
of conjecture since the Brexit vote but no one in
Ireland is really any the wiser as to their answers.
The backstop to nowhere?
The so-called backstop deal of December 2017
DCU Brexit Institute
which leaves the Irish border question to last in
the Brexit negotiations has seemingly come to
naught and has caused significant difficulties
for the minority Fine Gael led government. The
government is of the view that the December
agreement provides a legal provision to implement
the backstop of maintaining full alignment in
Northern Ireland with those rules of the Single
Market and customs union necessary to protect
32
North-South co-operation and to avoid a hard
border.
In asserting this position the Minister for Foreign
Affair Simon Coveney became very animated in
a heated Dáil debate on the topic in early March
2018 and has adopted a rather patrician air that
he should not be quizzed or criticised in any way on
Brexit. When the Fianna Fail leader Micheál Martin
accused the Taoiseach Leo Varadkar and Coveney
of naiveté on Northern Ireland in overselling the
Brexit deal of December 2017 and the anticipated
restoration of the Executive in Northern Ireland
(which never materialised) an irate Coveney
accused his constituency rival of misleading the
House, being unhelpful and not understanding
what was going on.
While the government may be fully satisfied with
such a backstop deal for a frictionless border after
Brexit, it is certainly valid to suggest that it may
in fact lie outside Britain’s withdrawal treaty with
the EU. Given that the Conservative government
in Britain has still given no real thought to the
border question beyond the ludicrous claims that
technology will somehow or other sort the whole
problem out, the backstop remains at best a
distant hope.
Yet technology has still not offered a border
solution and the position of Michel Barnier the
EU’s chief negotiator for Brexit also remains as it
was a full year ago when he became the first non-
elected official of any international organisation
to be invited to speak before the joint houses of
the Irish parliament. On that occasion he told the
Irish, and indeed the watching world, that ‘customs
controls are part of EU order management. They
protect the single market’. Barnier was blunt
in his assessment of the consequence of Brexit,
dramatically driving home the point that it comes
at a cost. By reiterating the point that Brexit
changes the external borders of the EU, Barnier did
what politicians often want to avoid: he spoke a
harsh but dutiful truth.
That remains the EU’s stance. If the British put
themselves outside that market, then a hard
border becomes inevitable. That is the irrevocable
price of Brexit and it is a dear one which no one
really wants to pay. The question of the border
continues to be intractable. After Barnier’s speech
in Dublin there was much talk of the idea of special
status for Northern Ireland which became the new
buzz word for ensuring a soft Brexit. The problem
is that it seems an almost impossible ask for the
British Conservative government to even begin to
think about such a position. The very words ‘special
status’ send a long shiver down the spine of every
Tory politician, particularly for those with long and
bitter memories of the conflict in Northern Ireland.
An hour before Barnier delivered his speech to
the Irish parliament in May 2017 I addressed the
Oireachtas Joint Committee on Foreign Affairs
on Brexit. I was struck by just how great the fear
amongst politicians of all parties was regarding
the impact Brexit will have on the border counties
in particular. This fear remains palpable in political
circles as Brexit looms ever closer but without any
pointer as to what it will actually look like at the
Irish border.
The vast majority of Irish people and pretty much
all of its elites have been horrified by the Brexit
result and subsequent events, particularly since it
has become clear that the governments of David
Cameron and Theresa May, both before and after
the vote, gave no real thought to the Irish question.
It has become somewhat fashionable in Britain
to blame the Irish government and the Irish body
politic in all its guises for having the temerity to
bring up the question of the border.
In reality this is the reflexive British response to their
surprise at the manner in which the EU and Ireland
speak as one voice about Brexit and the border.
Like much else in relation to Britain’s troubled
understanding of the EU ever since first joining
along with the Irish in 1973, there should really be
no surprise. The EU needs to stand in solidarity
with those who want to be in the club, not with
those who are about to leave it. That is its history.
Notwithstanding the odd domestic dispute about
political strategy Ireland realises this as well.
Gary Murphy,
Professor of Politics and Head of DCU School
of Law and Government
The Challenges
33
 The Legal Challenge

There has much been detailed and systematic
analysis of the causes and legal process of Brexit.
This short note is not intended to enter into
the details of the Article 50 process, the draft
withdrawal agreement or on the possible options
for a future relationship and how they may or may
not work in practice. Instead, it is an attempt to
take stock of Brexit as a legal phenomenon and in
particular to step back and assess the impact of
Brexit on law in general and in particular UK and
EU law. This note will briefly assess the impact of
Brexit on the constitutional law of the UK, the EU
and finally the emergence of a new type of law
– the law of disintegration within the context of
transnational regional law.
Impact on UK Law
Substantively, it remains to be seen how much of
the law of the UK will change. This will depend
on the future relationship with the Union and the
extent to which it is bound by EU law. However,
it is likely that the UK will move to being a norm-
taker in these fields – either formally or informally
- particularly in relation to market regulation, if
companies operating in the UK wish to maintain
access to the single market.
That Brexit will impact the constitutional law of
the UK is already evident. Firstly, it is affected
by the process itself and the questions it raises
for parliamentary sovereignty. However much
the UK Supreme Court can declare that the
ultimate decision for triggering Brexit lies with
the Westminster parliament, the sheer political
potency of a popular vote means that de facto
the decision has been made by popular acclaim.
Secondly, the sheer scale of the task to disentangle
the UK from the EU’s legal order will mean the
creation of a power vested in the Government to
alter UK legislation, including acts of parliament.
Thirdly and finally, Brexit has opened fault lines
DCU Brexit Institute
post-Brexit distribution of returned powers.
Impact on EU Constitutional Law
The impact on EU law both substantive and
constitutional is less direct and will likely take more
time to emerge. There will be an effect on the
evolution of substantive EU law with the absence
of a significant Member State with a strong
liberal agenda and a resistance to integration
affecting future laws in Europe. More immediate
is the constitutional impact. Brexit has created
something of a constitutional moment for the
Union. Contrary to immediate expectations, we
have witnessed a recommitment by the Member
States to the European project understood
broadly. Throughout the Article 50 process, the
values and principles of the Union - including the
nature and meaning of membership - have been
reasserted and clarified, as has the supranational
method, with the supranational Union institutions
playing a central role in partnership with the
European Council and Member States.
A Whole New Law?
Finally, Brexit will create a whole new legal order –
whatever the final label applied to the withdrawal
and future relationship agreements, it is likely that
Brexit will result in a new relationship between
the UK and the EU based on its own set of laws
and institutions lying somewhere between an
international legal order and a supranational
legal order. There certainly is some precedent

in the constitutional settlement between the

different constituent units in the United Kingdom
and in particular the relationship between the
devolved institutions and the central government.
While explicit calls of self-determination on the
part of Scotland in particular in the wake of Brexit
have abated somewhat, the process of Brexit has
opened the question of the role of the devolved
administrations in the process itself and in the
34
 for this; the Union has entered into a variety of
association agreements with third states and the
EEA regulates the relationship between the EU
and most EFTA states (with Switzerland being the
exception).
However, two factors - one a difference in degree,
one a difference in kind - differentiate this new
legal order from previous associations. Firstly, the
sheer importance of the UK as a political, economic
and security actor within Europe. Aside from its
scale the UK has a particular weight in certain key
areas such as financial services and security. This
will no doubt impact on the nature and form of any
agreement and its importance for future study.
Secondly, contrary to other agreements, the aim
of which is to bring the various associated states
closer to the Union economically and ultimately
legally, the UK’s association will be a regime
designed to remove the UK from the Union and
sever legal links; it is managed disintegration or
disintegration through law. Given that integration
has served as a key principle in the interpretation of
Union law, Brexit and the legal regime that results
opens up the possibility of a new set of principles
to manage divergence rather than convergence
in international legal relations. This is a whole new
departure for the field of transnational law and
transnational legal regimes and one that will call
for further study and elaboration.
35
Conclusion – A Tale of Two Unions
Brexit is a story of divergence. The United Kingdom
and the European Union are going their separate
ways. It is also a story of divergence of political and
constitutional experience. As is apparent, the UK’s
constitutional order, already under strain, has been
unsettled significantly by the event and process of
Brexit. Parliament’s role has come to be questioned
by the rise of a form of popular sovereignty and an
empowering of the executive, as is the devolution
settlement. On the contrary, the European Union –
at least so far – has managed to emerge stronger
and has had its constitutional underpinnings
reaffirmed. The Article 50 process itself has led to
a strengthening of the supranational institutions
and a reflection on the meaning of membership.
The result of Brexit, contrary to what was hoped for
by the Leave camp, has so far been infinitely more
damaging for the United Kingdom and to some
extent reaffirming for the EU. While this diagnosis
is well-known for the economic and political field, it
is no less true for the constitutional and legal.
Stephen Coutts,
Assistant Professor of Law, DCU School of Law and
Government
 The Business Challenge
The impact of Brexit on Ireland is a well versed
topic, with many experts weighing in to give their
view of the range of potential outcomes. Economic
think tanks and consultants have issued high level
reports on the dynamics of the UK split for Irish
trade, not just our direct business transactions with
the UK but also our use of their island as a vital land
bridge to connect with our EU partners. Potential
challenges identified include tariffs, quotas,
customs checks and cross border delays – never
mind the myriad complexities related to Northern
Ireland. The stages of the Brexit deal and the
possible ramifications are debated and discussed
by specialist commentators at length, with each
development analysed for its potential impact on
the overall trajectory of the exit negotiations, for
the EU as a whole but also specifically for Ireland.
The Irish situation is particularly problematic
because of the historic relationship between
Ireland and Britain. Our nearest neighbour
provided us with a gateway, in the form of a large,
culturally similar and geographically accessible
market, to learn the process of internationalisation.
As only 14% of our overall goods and 20%
of services are destined for the UK an initial
impression of our exposure is reassuring, but this
headline figure understates our vulnerability.
Deeper analysis reveals that more than 40% of
the exports of our indigenous firms are sold to our
nearest neighbour. Transport service businesses are
particularly exposed as over 60% or €2.5bn of their
total exports are UK bound. In addition, as almost
half of our tourist footfall is from the UK, any threat
to the free movement of people between the two
islands is of grave concern, particularly for small
businesses in this sector.
The multiplicity of reports commissioned and
prepared by policy makers, government analysts,
consultants and academics on the challenges of
DCU Brexit Institute
Brexit fall into three broad categories. Some adopt
a macro perspective considering the implications
of the Brexit impact on the economy as a whole or
for particular business sectors. Others suggest that
firms analyse worse/best case scenarios for their
particular business sector based on the potential
UK/EU trade agreements, largely focused on
the short to medium term impact. Lastly there
are those who adopt a practical approach for
36
businesses and offer a toolbox for analysing a firm’s
key short term exposure to the UK as either a major
market for its output, a vital part of its supply chain
for inputs, or a land bridge for accessing their EU
partners.
These reports provide valuable guidance and a rich
resource for organisations in their initial response
to the major shock of Brexit. Their identification
of risks and potential outcomes was particularly
useful in helping businesses make the transition
from disbelief at the referendum result to a slow
realisation that Brexit is now inevitable. Despite
several opportunities, it is now generally accepted
that the Brexit decision is not open for revisiting
and organisations must prepare for an uncertain
UK/EU relationship. The general conclusion of
these reports is that Irish organisations must
reorient their exports and reorganise their sourcing
strategies to/from destinations outside of the UK.
At face value, this suggested approach is simple,
Irish organisations can simply ‘just’ replace
internationalising to the UK with increased
internationalising to other EU neighbours. But this
injunction dismisses a multitude of complexities
which firms overlook at their potential peril. In
essence, organisations grow by either selling more
to existing customers or though developing new
customers, often in new markets. Achieving growth
in a familiar market in which you are well versed
with all aspects of its workings, from consumer
preferences to competitor tactics, is often easier
than building a new market from a zero base. This
is why, for many Irish firms the impact of Brexit
represents a major opportunity cost as it not only
potentially endangers their existing UK sales but
may put an end to their strategic hopes to further
take advantage of this familiar market by building
upon existing customer relationships in the area.
Developing new customers in new markets is
challenging even for organisations with a tradition
of internationalising to the UK. The rich history
and similarities between the UK and Ireland’s
customs and practices reduced market entry risk
and eased many Irish firms into the process and
risks of internationalisation. As a result, experience
of internationalising to the UK does not build a
depth of firm capabilities for internationalising
to more remote, diverse and unfamiliar markets.
It is not simply a question of firms switching their
efforts from one location to another. A central
risk of internationalisation is lack of familiarity
with a target market. Creating a presence and
attracting new customers in international markets
demands gathering market and competitor
intelligence. Firms will be forced to build a deep
awareness and comprehensive assessment of the
legal, political, economic, and social structures of
targeted international markets. Networks must
be developed, and for both the food sector and
professional service firms particularly, there is the
challenge of establishing reputations. The question
is how small Irish firms with limited resources and
internationalisation capabilities will build the
skills and capabilities required to internationalise
successfully. Firms must first identify and then
establish trading relationships in sufficiently
attractive locations to compensate for the looming
threat to business with the UK. The assumption
that those firms with a tradition of exporting to
the UK have developed the requisite portfolio
of skills and capabilities for internationalisation
to more distinctly different locations must be
questioned. Building these requisite skills for
internationalisation represents a further as yet
largely unrecognised, Brexit challenge for Irish
businesses.
Pamela Sharkey Scott,
Professor of International Business, DCU Business
School
Dónal O’Brien,
Assistant Professor in Strategy and International
Business, DCU Business School
The Challenges
37
 The Media Challenge
The impact of Brexit on media in Ireland and the
UK was felt almost as soon as the referendum
passed in June 2016. Having slightly recovered
in 2014 after a long post-2008 downturn, legacy
media advertising revenues plateaued again as
large corporations in the UK and Ireland slashed
their marketing budgets in anticipation of a “period
of consumer uncertainty”. On the other hand the
weakening of sterling, especially vis-à-vis the dollar
proved a boon for the UK film industry, making
the country a much cheaper location for footloose
Hollywood production. (It would also make UK-
based media firms tempting acquisition targets:
the ongoing respective attempts of US-based Fox
and Comcast to acquire Sky Television are at least
partially informed by such currency fluctuations.)
But there are also a series of potential longer-term
effects of Brexit on media in the UK, Ireland and
the wider EU. The UK’s pre-eminent position as an
audiovisual production centre within Europe owes
something to its having an Anglophone status and
an enviable cadre of internationally-respected
technicians - but also its EU membership. In an
increasingly straitened funding environment,
access to the kind of “soft” money accessed via
the EU’s Creative Europe programme (which the
UK availed of to the tune of £57 million between
2014 and 2016, along the way supporting the
distribution of 115 UK films across Europe),
was a manifest draw for inward production.
Furthermore, as required by EU Competition law
and the European Commission’s 2013 Cinema
Communication, film and television production
subsidies from beyond the UK - such as the Irish
Film Board and our Section 481 tax credit - are also
automatically available to productions based in
the UK. Freedom of movement has mattered too:
international co-production is now the norm across
European film industries, including that of the UK.
This inevitably demands cross-border movement
DCU Brexit Institute
of personnel. The first season of Game of Thrones
was shot on location in Northern Ireland, then
post-produced in Dublin. As the prospect of a hard
border looms, it’s not yet clear how post-Brexit
constraints - changing border security measures,
the introduction of work visas and possibly new
personal taxation arrangements - will impact such
free-ranging productions.
38
The decision of US-based television giants
operating across Europea - Sky, Liberty Global etc
- to locate their European headquarters in the UK
also owed much to the European Commission’s long
battle to create a single European broadcasting
environment. Commencing with the passage of the
first “Television Without Frontiers” directive in 1989
the European Commission espoused the “Country
of Origin” principle whereby a broadcaster
licenced to operate in one EU member state was
automatically permitted to broadcast into the
rest of the EU. Freed of the need to negotiate
28 different sets of regulatory hurdles, the UK
became a hub for the pan-national broadcasters
which consequently emerged: as of 2016, more
than half the 2,200 broadcasters operating
within the EU were licenced by Ofcom, the UK
electronic media regulator. Brexit would remove
this locational advantage in one fell swoop. This
may redound to Ireland’s benefit: already a hub
for digital tech companies - Apple, Facebook,
Amazon etc - whose screen content production
activities are increasingly converging with more
established film and television companies. The
explosion of independent audiovisual production
since the 1990s makes Ireland an increasingly
plausible alternative media hub for companies
like Sky looking to retain access to a wider
European market for their suite of channels. For
the UK, their potential exclusion from the Country
of Origin principle is particularly worrying, as
television channels there are increasingly seeking
to exploit online delivery mechanisms to make their
content accessible beyond their local borders. In
theory the Council of Europe’s 1989 Convention
on Transfrontier Television might maintain UK
broadcaster access to other CoE members but
that Convention only applies to traditional linear
broadcast modes and makes no mention of online
content.
Finally, if a post-Brexit environment did encourage
a migration of broadcasters across the Irish Sea,
this might also see the myriad of currently UK-
located opt-out channels fall under the regulatory
purview of the Broadcasting Authority of Ireland
for the first time. Typically found in the nether
regions of your electronic programme guide, such
channels cumulatively account for nearly a third of
television viewership and associated advertising.
Yet another element of the Television Without
Frontiers directive (and subsequent Audiovisual
Media Services Directives) raises post-Brexit
issues both for British programme-makers but
also for commercial channels in Ireland. In a bid to
create a protected internal market for European
programme makers, the directives have long
required European channels to set aside 51% or
more of their schedules for European-produced
material. This proved a boon for UK production:
already associated with high-quality output, UK
productions found a ready market in the rest of
Europe as broadcasting was deregulated in the
1990s, especially in weaker production contexts
such as Ireland where broadcasters lacked the
resources to extensively invest in expensive genres
like drama. However, post-Brexit the fact that
British content will no longer count towards such
quotas will complicate matters for broadcasters
seeking to comply with the directive. This will
certainly create issues for RTE given its reliance on
popular soaps like the BBC’s Eastenders but may be
critical for TV3 whose primetime schedule is often
exclusively constituted by UK imports - Coronation
Street, Emmerdale, and the various “shiny floor
shows” (X-Factor et al). Since 2006, TV3 has
already moved towards greater levels of indigenous
production (albeit from an initially very limited
inhouse commissioning base). Will it have to move
further in that direction to meet the requirements
of the directive?
Lest we think that film and television might seem
like trivial matters relative to the political and
economic challenges discussed elsewhere, let us
conclude by recalling that the Creative Industries
now account for 14% of Gross Value Added
(GVA) in the UK economy and that the sector
there is growing at twice the rate of the economy
as a whole. In 1993, at the time of a US-EU
trade dispute over the audiovisual sector which
threatened to derail the last round of the GATT
negotiations, the French film producer Daniel
Toscan du Plantier observed that having long been
the side salad in world commerce, cinema had
become “the beef”. The UK cannot afford to treat
the fate of that particular foodstuff lightly as it
stumbles towards departure from the EU.
Roderick Flynn,
Associate Professor of Media, DCU School of
Communications
The Challenges
39
 The Education and Research Challenge
Yanis Varoufakis famously compared Brexit to
the Hotel California, in that you may check out,
but you can never leave. From the outset, Britain
has declared its intention to remain within the
European research and innovation community.
Indeed, amongst the priorities of Theresa May’s
‘Plan for Britain’ was an ambition to ‘remain the
best place for science and innovation’ through
‘close collaboration with our European partners’.
Pascal Lamy, too, described ‘full and continued
engagement’ as a ‘win-win’ for both the UK and
the EU, and such shared sentiments comforted
commentators, including Kurt Deketelaere,
secretary of the League of European Research
Universities, who concluded that, in the research
and innovation space at least, ‘Brexit will not
happen’.
Two years on, that complacency appears
misplaced, and debate has scarcely advanced
from the ambiguity of the initial ‘Brexit means
Brexit’. In essence, of course, the education issue
will only be clarified in the context of the overall
resolution. Yet, for Higher Education Secretary,
Sam Gyimah, there remains ‘no ambiguity’ about
Britain’s desire to continue within the European
Programmes, but ‘not at any price’. The British
Government’s ‘Framework for the UK-EU
partnership; science and innovation’, reiterates
May’s ambition for a ‘deep science partnership’
but it, too, demands a ‘suitable level of influence’ in
return for ‘an appropriate financial contribution’.
As in trade and services, then, Britain has rejected
passive ‘pay-to-play’ participation. Despite Michel
Barnier’s conciliatory assurances on future research
collaborations, delivered at Dundalk, the European
Commission appears determined to reduce Britain
to ‘third country’ status in Horizon Europe, behind
Turkey, Albania, and Israel who enjoy ‘associate
membership’ of the current Horizon 2020. Britain
would be relegated to a third division, along with
DCU Brexit Institute
Canada and South Korea, who are required to
pay higher contributions, excluded from certain
innovation programmes, and disqualified from the
new European Innovation Council. Critically, too,
Britain would be explicitly prevented from receiving
any ‘net transfer from the EU budget’.
Dismissed as ‘Scrooge-like’ by Thomas Jørgenson,
senior policy coordinator at the EUA, this draconian
40
position is untenable and certainly not in Ireland’s
interest. Britain is an essential part of the European
research ecosystem; its higher education sector is
the ‘collaborator of choice’, and the excellence of
British research is reflected in the disproportionate
success it enjoys in Horizon 2020, receiving 15% of
all available funds. In the Humanities and Social
Sciences, too, British researchers received over
30% of the European Research Council awards in
the period 2007-15. Yet while this is an indicator of
research excellence, it also illustrates the exposure
of British universities to a Brexit shock, as these
transfers account for a quarter of the national
research budgets in these disciplines. Moreover, the
British Academy has emphasised the importance
of ERC grants, and EU funding in general, as a ‘pull
factor’ in the battle to attract talent, and fear of an
exodus of the 50,000 EU academic staff working in
British universities has placed immigration policy
firmly on Sam Gyimas’s agenda.
The uncertainty of Brexit, and the threatened
exclusion of our closest partner from the
European research community, has significant
implications for the Irish higher education sector.
Niall Fitzgerald, chair of the Leverhulme Trust,
characterised these as a ‘catalyst rather than a
catastrophe’, but to date Ireland has failed to
respond adequately to either the challenges or the
opportunities presented by Britain’s ambiguous
future in EU research. Over 13,000 Irish students
study in UK universities, including Northern
Ireland, and the state does not have the absorptive
capacity to educate them at home. 3,500 British
students attend higher education institutes here,
and Ireland is the 7th largest provider of academic
staff to British universities. In research, too, there
are currently in excess of 900 collaborative projects
between Ireland and the UK funded by the EU’s
flagship Horizon 2020 programme. Reflecting
on the priority of that Ireland-UK relationship,
the president of the Royal Irish Academy (RIA)
recently observed that, between 2012 and 2016,
over 12,900 research papers were produced from
collaborations between Irish and UK researchers;
more than all the publications with France and
Germany combined.
Education and research in Ireland will be greatly
undermined if Britain is excluded from EU
programmes as the latest soundings from Brussels
threaten. The Irish government must offer its
support for the UK remaining within the European
Research Area. However, Brexit has potential to
elevate the higher education sector in Ireland. As
an English speaking country with an assured EU
base and access to large-scale research funding,
Ireland offers a unique and attractive proposition
to EU and non-EU researchers and students
alike. In this regard, it has a once off opportunity
to become a world leading research centre.
Regrettably, the state has been slow to recognise
this opportunity or to apply an appropriately
ambitious strategy, and it has failed, unlike the
UK, to explicitly name Education and Research
as a national priority in the Brexit debate. The
Minister’s Action Plan for Education 2018 has
incidental references to Brexit and one paragraph
entitled ‘Being Brexit Ready’, but it is largely
focussed on the ‘Skills-for-growth’ agenda; to
date we have not seen the promised ‘strategy …
to attract world-leading researchers to Ireland’
nor the creation of ‘additional awards funded
by the Research Council’. Science Foundation
Ireland has offered a range of targeted proposals,
including developing a support structure for joint-
professorships between the UK and Ireland. Most
recently, in May 2018, it launched an ambitious
€100m ‘post graduate training programme to
meet industry skills needs’, and we hope that this
will be followed by more broadly based initiatives
across the Higher Education sector. Brexit presents
particular challenges to Northern Ireland, and
96% of respondents to the RIA taskforce survey
believed it would have negative effects for the
region. Sustained action is required to enhance
cross-border collaboration and, in addition to the
‘backstop’ and other novelties,
the Irish government should
promote a special status
‘education area’ for the island
of Ireland.
Ultimately, the impact of
Brexit on higher education
and research in Ireland will
be determined by the Irish
government’s willingness
to invest in the sector.
Brexit initiatives cannot be
applied in a vacuum and
there is simply no chance
of Ireland maximising the
opportunities within a grossly under-funded system
of higher education. The Brexit taskforce of the
Royal Irish Academy highlighted ‘alarming signs of
strain across the sector’ including underfunding and
declining student-staff ratios, which at 20:1 are
considerably above the OECD average (14:1) and
will be compounded by the substantial population
growth which the Department of Education has
projected to 2029. The ability to attract top-flight
researchers is limited by structural challenges,
just as the ‘Shanowen Shakedown’ and USI-led
demonstrations across Ireland in response to
student-housing shortages, demonstrate the
challenges in making Ireland a destination of choice
for international students.
A decade of austerity has eroded the quality
and standing of Irish education, as graphically
illustrated by the continued decline of Irish
Universities within the global rankings. Rhetoric
and cosmetic initiatives will not compensate for a
failure to invest in line with the recommendations
of the Cassells Report, or the Government’s own
‘Innovation 2020’ strategy. There are few aspects
of Brexit that have a potential silver-lining for
Ireland, but the higher education and research
sector provides one such prospect. Political courage
is required not just to leverage the opportunities of
Brexit, but to put our house in order, and to provide
the higher education system required to deliver
national economic and social development and the
Taoiseach’s ‘Republic of Opportunity’.
Daire Keogh,
Professor of History and Deputy President, DCU
42 DCU Brexit Institute
Conclusion

The DCU Brexit Institute organized in cooperation with the Irish Department of Foreign Affairs (DFA)
a number of events outside of Ireland to raise awareness about Brexit and promote the debate on
the future of Europe in several key European capitals. On 1 February 2018 the DCU Brexit Institute
held an event with the Irish Embassy to Italy in Rome on “Brexit and the Future of Europe: Irish and
Italian Perspectives” which was opened by Ambassador Colm O’Floinn, featured a keynote speech of
Sandro Gozi (Minister of State for European Affairs of Italy) and a panel with Brigid Laffan (European
University Institute), Michele Valensise (Villa Vigoni) and Federico Fabbrini (DCU), moderated by
Leonardo Maisano (Il Sole 24 Ore). On 26 March 2018 the DCU Brexit Institute held an event with the
Irish Embassy to the UK in London on “Brexit and the Future EU-UK Relations”, which was opened
by Ambassador Adrian O’Neill, featured a keynote speech by Keir Starmer (UK Shadow Secretary
of State for Exiting the EU) and a panel with Catherine Barnard (University of Cambridge), Henry
Newman (Open Europe) and Federico Fabbrini (DCU), moderated by Fiona Mitchell (RTE). Finally, on
9 April 2018, the DCU Brexit Institute held an event with the Irish Permanent Representation to the
EU in Brussels on “One Year to Withdrawal”, which was opened by Permanent Representative Declan
Kelleher, featured a keynote speech by Phil Hogan (European Commissioner for Agriculture) and a
panel with Emer Deane (DFA), Stefaan de Rynck (EU Commission Article 50 Task Force), and Federico
Fabbrini (DCU), moderated by Mehreen Khan (Financial Times).

The decision of the United Kingdom (UK) to leave
the European Union (EU) constitutes a momentous
event: while for the first time in European history
a member state withdraws from the EU, Brexit
raises huge challenges for the UK constitutional
settlement in Scotland and Northern Ireland, for
the relations between the UK and Ireland, as well as
for the future of the EU as such.
First, the DCU Brexit Institute has organized over
a dozen high-level events, involving a balanced
assortment of speakers from Ireland, Europe and
the UK – and featuring keynote addresses by
some of the most distinguished authorities in the
field, including current and former Presidents and
Commissioners, Ministers of Foreign Affairs, and
Members of the EU, UK and Irish Parliaments.

Since its creation – exactly a year after the Brexit
referendum, on 23 June 2017 – the Brexit Institute
of Dublin City University (DCU) has represented a
unique platform to debate and document Brexit
– and as Ireland’s only and Europe’s first center
specifically focused on discussing this topic, the
Brexit Institute has emerged as a leading voice in
the international arena.
This booklet, which included contributions by
academics from Schools and Faculties across
DCU, is the latest output we have produced to
Second, the DCU Brexit Institute has produced
a continuing stream of scholarly output, with the
publication of weekly blogs, monthly working
papers – as well as a book and a policy report for
the European Parliament – hence contributing to a
focused, interdisciplinary analysis of the problems
raised by Brexit, and bringing forward some
innovative ideas on how to deal with the challenges
ahead.
Third, the DCU Brexit Institute, which is proudly
sponsored since its founding by Arthur Cox
Conclusion

provide expertise and insight on the Brexit debate.
However, as the ‘facts and figures’ reported in the
next pages highlight, the DCU Brexit Institute has
delivered on its mission of providing expertise on
Brexit through multiple avenues.
solicitors, has developed partnership with a
number of public and private organizations – a
full list of which is reported below – thus engaging
in a detailed, sector by sector examination of the
implications that Brexit poses for government,
business and society at large.
43
Yet further work needs to be done. Brexit remains
clouded with uncertainties – with critical issues,
including the problem of the border between
Ireland and Northern Ireland and the protection of
the Belfast Good Friday Agreement, to be solved
in the short run, and other challenges, including
the framework of future EU-UK trade and security
relations, still to be teased out for the long run.
In fact, beyond Brexit, major questions surround
also the future of Europe at 27. While the euro-
crisis, the migration crisis, and the worrying threats
to the rule of law emerging in a number of EU
member states have created deep cleavages in the
EU, a broad debate is ongoing across Europe on
how to design the future of the EU – including its
budget and policies – after Brexit.
Yet, while Ireland’s commitment toward European
integration seems stronger than ever, challenges
abound. Besides cracks in the transatlantic
partnership, the specter of a global trade war and
political instability, the rise of populist forces even
in a founding EU member states like Italy have
raised the prospect that other countries may follow
the UK and exit the EU (or the Eurozone).
In this context, it is crucial to have a dedicated
center like the DCU Brexit Institute – which is more
than a think tank, due to its academic grounding,
but more than a standard academic department,
due to its policy side – to continue tracking closely
the developments in the Brexit talks, raising
awareness on the issues at stake, and providing
thought leadership on the future of Europe
debates.
As the DCU Brexit Institute moves into its second
year of existence, therefore, we will remain a
valuable source of expertise for government,
business and society at large. And in fact, we aim
to expand our partnerships by engaging with a
growing numbers of public and private institutions
– providing a strong European perspective on the
Brexit risks and opportunities ahead.
As such, the DCU Brexit Institute welcomes the
possibility of enlarging its network and to support
organizations preparing for the UK withdrawal
from the EU – which is now only nine months away.
While uncertainty remains the fil rouge of Brexit,
there is one certainty: the DCU Brexit Institute will
be there, as the authoritative center to explore it
from a research and policy perspective.
Federico Fabbrini,
Director of DCU Brexit Institute
Facts and Figures

People 35

5 Staff 28 Affiliated 2 Interns

Staff

The DCU Brexit Institute involves staff from the School of Law and Government, School of
Business, School of Communication, School of History, School of Nursing & Human Sciences

Publications 60

50 Blog 1 Book 8 Working 1 European

Articles Papers Parliament
Report

Facts and Figures

45
 Events 13

10 in Dublin

1 in London

1 in Brussels
DCU Brexit Institute

1 in Rome
46
 Keynote Speakers 30

Nationalities
of Keynote
3 Former Prime Ministers
3 Current and
Former Presidents
Speakers and
4 Current and former
European Commissioners
Panelists
1 Central Bank
Deputy Governor
31 Irish
19 British
2 Members of the 24 European
Irish Parliament 5 Current Ministers of
Foreign Affairs, European 3 North American
Affairs or equivalent

6 Members of the
UK Parliament
4 Current Members of the EP

Media Coverage Weekly appearances on print/online/radio/TV

Facts and Figures

47
 @dcu_brexit_inst

E: brexit.institute@dcu.ie
www.dcubrexitinstitute.eu

Founding Sponsors

Public Institutions

Businesses and Civil Society Groups

Media Partners Academic Partners